Address by 

Elbert H. Gary 

President, American Iron and Steel Institute 

At Semi-Annual Meeting 
St. Louis 



October 27, 1916 



^ iy»/ 



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Address by the President, Elbert H. Gary, ait Semi- 
annual Meeting of American Iron and Steel 
Institute, St. Louis, October 27, 1916. 

At the last directors' meeting of The Institute, before 
the summer vacation, a member suggested that, at the 
October meeting, I give some account of my proposed visit 
to the Orient and therefore he properly may be charged 
with the responsibility of the President's remarks on this 
occasion. 

I left New York on July 3rd for Toronto and from 
thence proceeded via the Canadian Pacific Railroad to 
Vancouver; sailed on the Empress of Asia July 13th; 
arrived at Yokohama July 24th (dropping one day at the 
180th meridian and picking it up again on the return 
trip), and from there went on same steamer to Manila, 
arriving July 31st. I left Manila on another ship (Japan- 
ese) August 7th for Hong Kong, overtaking the Empress 
of Asia, which had preceded the Japanese ship, and 
sailed for Shanghai. From there I went through por- 
tions of China (visiting Peking, Soochow, Nanking and 
various other places in the eastern and northern 
part) to Mukden, in Manchuria; Seoul, in Korea, and 
then across the Japan Sea or Strait of Korea to Shimo- 
noseki, in Japan, arriving August 29th. I remained 
in Japan until September 14th, when I embarked on the 
Empress of Russia for Victoria, B. C, arriving September 
23rd. I visited the principal cities in Japan and motored 



considerably through the country, as I also did in China 
and the Philippines, wherever practicable. The journey, 
taken as a whole, was long, rather warm and somewhat 
tiresome, as I expected it would be, but it was all inter- 
esting and enjoyable and a trip to be recommended, even 
in the summer months. The accommodations for the 
traveler are generally good and in many respects are 
excellent. 

This brief outline has been given because I am hoping 
many of my hearers will be inclined to inquire into the 
details and then to personally inspect this fascinating 
portion of the Earth situated on the opposite side of the 
Globe from your habitation. I will later suggest reasons 
for my wish. 

There are many phases of Oriental life and customs, 
of natural and artificial beauty, of contrasts between the 
old and new civilizations, all of which attract and interest 
the student and charm the traveler; but it is not my pur- 
pose to attempt at this time to do more than glance at 
some of the general features of the different countries 
mentioned, in which it seems to me you, as business men, 
are especially concerned. I was diligent and impartial 
in the endeavor to ascertain facts that appeared to have 
a bearing upon your interests and mine in the affairs and 
conditions of these nations respectively. I saw as much 
of the countries and as many of the people as the limit of 
time permitted. Posing only as a member of the business 
fraternity, I received from foreigners everywhere the most 
hospitable and generous treatment and the frankest ex- 
pression of sentiment toward the people of the United 



states. Also our diplomatic representatives, without 
exception, were courteous, lielpful and hospitable; they 
are rendering faithful and efficient service. 

The Philippines. 

The Philippine Islands, with proper development and 
modern practice, are capable of supporting comfortably 
ten times, or more, the number of people now living 
within their territory. There can be produced everything 
indigenous to semi-tropical latitudes and many things to 
better advantage than on any other lands within the same 
proximity to the equator. Hemp, tobacco, sugar, rice, 
cocoanut oils, coffee, fruits, vegetables, grains, choicest 
timber and multitudes of other valuable products can be 
raised in as large or larger abundance than in any other 
country, with comparatively slight exception. The 
natural requisites, including moisture, water-power and 
particularly richness of soil, are all sufficient. The 
climate is equable and excellent. In the summer, it is 
warm during the middle of the day, but the nights are 
agreeable, and, on the whole, the temperature seemed to 
me very much better than the average. No doubt the rec- 
ords will show favorably by comparison. The Filipinos, as 
a race, are a fine people, intelligent, of good disposition 
and possessed of capacity for success. I met large num- 
bers of them, confined perhaps to the better educated 
classes, but nevertheless representative. With opportu- 
nity, example and precept they will take a desirable place 
in the ranks of progressive and worthy citizens. 



When the United States paid nearly |20,000,000 to 
Spain, the owner, for the title to the Philippine Islands, 
she acquired a territorj' possessed of all the essentials for 
building up a rich, healthful and desirable extension of its 
dominions as a valuable and necessary supplement to the 
immense productive capacity which she already possessed ; 
and it was inhabited by a people who, by nature, would 
readily become loyal and faithful citizens of our country. 
When the United States, by mere chance, or as the result 
of an overruling Providence, became responsible for the 
future welfare of the inhabitants of the Islands and for 
the conditions which might directly and seriously affect 
other countries, especially those in proximity, there was 
much in the condition of the people to be deplored. The 
masses were ignorant ; perhaps purposely deprived of edu- 
cation; and they were subjected to tyranny and cruelty. 
They were poor, unhealthy, diseased, overtaxed and 
wretched. They were more or less at war with each other 
and with their Government. Every influence, every 
tendency, was bad. They had no hope for the future. 
Intelligent happiness' was neither a reminiscence nor 
even an aspiration. Because of the diseases prevalent, 
both the people and their beasts of burden were a menace 
to the outside world. The Filipinos were not blamable 
for this situation; they deserved a better fate. 

The United States was a good Samaritan. The splen- 
did men who were duly appointed by our country, includ- 
ing both military and civil representatives, with 
fortitude and judgment and human instincts took up and 
carried on the work of renovating and rejuvenating this 



conglomerate of physical and moral corruption, which 
had developed without the fault or the understanding of 
the people themselves. The results of their efforts will 
stand for all time to come as a monument to the generous, 
humane and intelligent policy of an enlightened and un- 
selfish nation, unless something shall be done in the 
future to counteract or neutralize the results of the course 
which has been pursued. All those who have represented 
the United States in bringing about the wonderful changes 
in the Philippine Islands are entitled to the highest com- 
mendation. Their work has not been fully appreciated 
by the average citizen of this country. 

There has been established a sound and exemplary 
government. The laws are wisely and justly administered 
by able and impartial judges; modern and commodious 
hospitals have been built and are in charge of competent, 
practical and humane doctors and nurses; plagues and 
dreadful contagious and infectious diseases have been 
largely stamped out ; model schools, special and common, 
have been established, and they are filled with eager and 
industrious Filipinos taught in the English language. 
Good roads have been built ; agriculture, horticulture and 
forestry have been improved; means and methods for 
civilization and for modern practical results have been 
taught, though, of course, much remains to be done. 

There has been a general cleaning up, and the best 
results of experience in other up-to-date countries are be- 
ing applied so far as possible. Filipinos understand 
and appreciate what has been done, and they are a grate- 
ful people. Of course, the large majority are referred to. 

5 



There are always exceptions. All this has cost and is 
costing large sums of money, but emphasis should be 
given to the fact that, with the exception of the money 
paid for maintaining the army and navy, which is no 
more than it would be if stationed elsewhere, the total 
expense of making the improvements and changes ad- 
verted to and maintaining the same, as well as the 
expenses of administration, including the civil govern- 
ment, courts of law, salaries of appointees of the United 
States Government, schools, hospitals and everything else 
of the kind, are and, from the start, have been paid from 
the treasury of the Philippine Government. 

Without the protection and assistance of the United 
States ; without the experienced talent of representatives 
sent from here; without the added energy, skill and in- 
vested capital of Americans; if the Filipinos were again 
left to themselves, they would be unable to make the 
progress in the development of the resources of the 
country which is possible and desirable; and the future 
of the Islands would be uncertain. They would not long 
be permitted to drift towards old conditions so as to be 
a menace to the health of neighboring nations particularly 
interested, for the latter would interfere and probably 
take possession and control. 

The United States assumed a moral obligation to the 
Filipinos and to other nations when she took charge of 
these islands. She could not shirk it if she wished to 
do so. 

Moreover, if the Filipinos desire it, as I believe they 
do, and if the United States, as I think a majority of 

6 



the citizens wish, shall decide to have the Philippine 
Islands remain permanently a part of the territory of the 
United States, it would result in great financial benefit to 
the Islands and their inhabitants and also to the United 
States; and all other nations would approve. Consider- 
ing the interests of the Filipinos and the Americans both, 
it would be a grave mistake to sever the relations now 
existing between them. 

There cannot be properly developed the immense 
natural resources of the country and the resulting busi- 
ness, with adequate facilities for conducting the same, 
without large amounts of capital, and it is impossible to 
secure these unless and until there shall be permanently 
established a government which is satisfactory and will 
not be assailed. If the United States should abandon the 
Islands, capital already invested would be withdrawn, 
in part at least, and additional investments would be dis- 
continued. The Americans in the Philippines who have 
done and are doing much to advance the pecuniary inter- 
ests of the Archipelago, as well as the natives themselves, 
understand and openly recognize the fatal results to the 
Islands if they should lose our support. 

China. 

During the last few decades, at least, China has not 
kept pace with others in the progressive march of nations. 
Possessed by nature with extraordinary opportunities 
she has nevertheless been retroactive in disposition and, 
to some extent, has been exploited for the benefit of 
others. With a population of 400,000,000 and a territory 



almost as large as Russia, containing the richest and most 
productive soil, a variety of climate which permits the 
growth and maturity of the principal grains and fruits, 
and with an abundance of the richest minerals, she has, 
notwithstanding, become poor in cash resources; and the 
normal and necessary development of the country for 
the proper utilization of the national assets has been 
neglected, if not ignored. Consequently, in the considera- 
tion of questions relating to economic expansion, and in 
other respects, China has, for a long time, been well nigh 
helpless. It would not be useful, nor does time permit, to 
discuss the reasons for these conditions. Many of them 
are well known. It is sufficient to say that China, with 
her natural facilities, has the opportunity of becoming 
one of the greatest and most prosperous of nations. 

Apparently, the leading Chinese statesmen, the most 
intelligent and most influential citizens and the best 
thinkers are keenly alive to the situation and are earnestly 
solicitous for the immediate future of China. The present 
Governmental Administration and the Parliament as well 
are devoting their talent and energy to ascertain and 
apply a solution for the problems which interfere with the 
growth and strength of their country. They realize that 
there is needed a new constitution which will establish a 
concentrated, unified, though democratic, government; a 
new and modern financial system which will be satisfac- 
tory to the financiers throughout the world ; an adequate, 
thoroughly trained and fully equipped military force for 
defensive purposes ; and the adoption of a systematic plan 
for the development of the whole country for the benefit 

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and for the promotion of the welfare of the whole popula- 
tion. The leaders are frank and outspoken in declaring 
the desirability of a government such as I have indicated ; 
and they appreciate also the necessity of having the 
friendship and assistance of all other nations. They know 
that, under these conditions and with this attitude on 
their part, and not otherwise, they may expect to establish 
a credit which will secure the loans necessary to reor- 
ganize the affairs of government, and will put to practical 
use the instrumentalities for providing the money which 
is now lacking. 

The present Government is an honest, unselfish, 
capable, industrious and harmonious organization. There 
are statesmen in China of high intelligence and quali- 
fications. It should be only a question of time when 
the internal strifes, that are prevalent and have done 
so much to obstruct and retard legitimate growth 
and prosperity, will have ceased; when the peoples 
of the different provinces will be pacified and possessed 
of a spirit of genuine loyalty and patriotism. This is 
what is especially needed in China, and this is what will 
be experienced when there is a clear and general under- 
standing of the motives of those now in governmental 
control. 

China is now in a transition stage of activity. For a 
single and simple instance, the visitor to Shanghai may 
see from his hotel window, within a space of two hundred 
by seventy-five feet, the jinrikisha, the sedan chair, the 
wheelbarrow (carrying a large load of freight or passen- 
gers), a cart drawn by a caribou or water buffalo, a 

9 



donkey or pony cart used as a passenger vehicle, a bicycle, 
an automobile, an electric train; and nationalities and 
costumes of a great variety of patterns and styles. 

One of the principal things needed in China is first- 
class railroads. We know by experience what they are 
and do for a new country. There are provinces with im- 
mense acreages of the most fertile soil and a population 
of scores of millions, that have no pretension of reason- 
able facilities for getting to purchasing or consuming 
markets. If there can be established the basis of credit as 
already suggested, and as now seems probable, it is to be 
hoped American capitalists will participate in further 
loans which will permit the rapid extension of railroad 
lines, for this will tend to correspondingly increase the 
volume of general business between the two countries. 
The people of China who are well posted are desirous 
of maintaining the most cordial and intimate rela- 
tions with the business concerns of the United States. 
Formerly China desired to be left alone. She wanted to 
be exclusive and seclusive. She claimed to be self- 
contained, and really thought it was wise to live unto her- 
self alone. That belief and attitude are becoming changed 
as a nation. She now wishes the open door policy to pre- 
vail. The national latch string is out for all other nations. 
Indeed, in some instances, those in authority have been 
too willing to grant concessions. Permanent concessions 
of territory at Shanghai, Peking, Hankow, Hongkong 
and other places have been granted to various foreign 
countries who still own and occupy the same. The United 

10 



states was formerly included in the list, but I think we 
have released and abandoned all that were ever given to 
us. 

The people are becoming familiar with the habits and 
methods of other peoples. They are entering educational 
institutions in other countries and they are learning the 
English language. True it is that large numbers in out- 
lying provinces are ignorant concerning the language or 
ways or even existence of foreigners, but all those in con- 
trol of national or provincial affairs are well advised and 
they welcome every opportunity to learn and to assim- 
ilate. Especially does China need and desire the sym- 
pathy and neighborly support of the people of the United 
States. Here is a great field for operation on the part of 
American business men which can be cultivated without 
injury or objection on the part of any other nation and 
with decided benefit to China herself. I could wish that 
in some respects the conditions in the United States which 
now exist, resulting, I think, from political agitation, 
might be modified. 

The Chinaman is naturally strong, diligent, indus- 
trious, economical, honest and intelligent. He is a good 
farmer and a shrewd merchant. He would like to be a 
good and loyal citizen, and it is only because he has been 
imposed upon or has misunderstood the facts that he 
appears to have been at times unreasonable or disloyal. 
He is a force in the world that must be considered, and 
it is wise to influence him honestly and practically in the 
right direction whenever the opportunity is afforded. 
Where Chinese blood is mixed with the Hawaiian or 

11 



Filipino it has raised the standard of intelligent man- 
hood, so far as I have observed. 

There are men listening to me who will live to see 
China a great and prosperous nation ; rich, powerful and 
progressive ; better than she ever was in her palmiest days ; 
one of the best creditors of and debtors to other countries ; 
and at peace with all the world. I hope and trust she is 
just now making a successful start in this direction. I 
have for her the same kindly feeling which so many of her 
best people undoubtedly entertain toward the United 
States. She will sometime have the power to do harm, 
but instead she may be a force for international peace, 
progress and prosperity. 

Throughout the country and in the cities and villages 
there is much to surprise and charm the visitor. There 
may be seen uncleanliness in many places and crowded 
habitations to the extent of danger to health, but in other 
places it is decidedly different in appearance. For illus- 
tration, there is a striking contrast between Canton or 
Soochow, on the one hand, and Peking, on the other. The 
latter has an abundance of open space. 

Scattered over the farms, throughout the country, are 
innumerable mounds of earth resembling, from a distance, 
cocks of hay. These are graves of the dead. They are of 
different sizes, depending upon the prominence or lack of 
prominence of the departed, and perhaps some other con- 
siderations. As ancestry is worshipped and the spirits of 
the deceased believed to visit, if not abide near, the graves, 
one can understand why, for years, the Chinese objected 

12 



to the disturbance of the lands resulting from the build- 
ing of railroads. 

The use of opium is diminishing and will disappear in 
the comparatively near future. 

Many books have been and more will be written on 
China; but to understand and appreciate one should per- 
sonally observe. 

I have endeavored to excite your interest only in some 
of the practical things that ordinarily engage the atten- 
tion of the business men. We should know the country 
and its people better from the standpoint of our own 
interests. 

Japan. 

Japan is a vigorous, progressive, prosperous nation. 
Representatives have temporarily resided in foreign coun- 
tries, including England, Germany and the United 
States, for the purpose of studying the languages, 
customs, methods, improvements and facilties for ad- 
vancement and for defense; and on their reports, from 
time to time, the Japanese people have adopted and 
assimilated what they consider to be the best features of 
enlightened civilization shown in the different countries. 
They are highly intelligent, determined, adaptable, very 
industrious and, above everything else, superbly loyal to 
their emperor and to their nation. The ordinary citizen 
lives for his country and is just as willing to die for it. 
There are no internal strifes ; on the contrary, there is a 
harmonious whole. They present to the outside world a 

13 



united front. This is as it ought to be in every nation. 
It gives a solidarity of power that is invincible. 

It may therefore be seen why Japan has taken a lead- 
ing position amongst the nations of the world, contrasting 
in a striking manner with her place sixty years ago. 
Rice is the principal, though not the only, crop grown 
in Japan. As the Islands are mountainous and not 
fertile, it is probable at least fifty per cent, is not culti- 
vated. The fish industry is large and profitable. In farm- 
ing, mining, manufacturing, merchandising, and with 
respect to her schools, hospitals, courts, prisons, temples, 
means of transportation, military training and strength 
and, generally, in the possession of modern equipment and 
administration of public and private affairs, Japan 
excels, and already may be considered a model govern- 
ment in many particulars. 

Japan has grown and is growing with her strength. 
She has, with Korea, Formosa and other island territory 
recently acquired, 259,671 square miles and a population 
of 72,000,000, as compared with 37,000,000 in 1872. Be- 
sides all this, she is now increasing in wealth and in the 
near future will, I believe, be considered rich, unless her 
present policy shall be abandoned. Her financiers, her 
business men and her statesmen deservedly rank high. 
They are farseeing and they are conservative. The won- 
derful natural beauties and artistic development and dis- 
play, I cannot take time to describe. 

I am disposed just now to discuss briefly before you 
questions which, as a business man, I was free to speak 
about in my intercourse with Japanese acquaintances. 

14 



Because I was open and sincere and especially as I was 
an American, independent of any political obligation to 
consider questions of diplomacy, I met willing and atten- 
tive listeners and cordial greetings. 

For some time there have been suggestions, in public 
and in private, in the United States and in Japan as well, 
that, for numerous reasons not necessary to recall, there 
was possibility, if not likelihood, of active hostility be- 
tween these two countries. Whenever either Government 
has decided to provide an additional warship some one in 
the other country has been prompt in charging that this 
meant preparation for war between these two nations. 

I said repeatedly, on my own responsibility, making 
no claim except that I believed I could accurately repre- 
sent public sentiment, that a large majority of the people 
of the United States did not desire, but would deplore and 
stubbornly oppose, war with Japan, except in self- 
defense, and that they were of the opinion there is not now 
nor will be any cause for serious trouble or disagree- 
ment; that there need be no conflict of opinion which 
could not be finally and satisfactorily settled by mutual 
negotiation and consideration. I also expressed the belief 
that our governmental administration is and would be 
inclined toward this most desirable exercise of authority. 
To all this I am sure this large company of representative 
business men will heartily subscribe. I would repeat and 
emphasize the sentiments thus expressed. 

And now, gentlemen, I am here to say to you in words 
just as emphatic and in a belief no less absolute that the 
leading and controlling men of Japan are equally anxious 

15 



to have a continuance, permanently, of the peaceable and 
friendly relations now existing between these two coun- 
tries. That there may be exceptions may go without say- 
ing; it would be usual and need excite no surprise nor 
fear if such is the fact. Still I have no positive informa- 
tion on which to base this conjecture. I had good oppor- 
tunity to ascertain the real situation, though my visit to 
Japan was comparatively short. The most prominent 
and influential men in Japan are outspoken in their pro- 
fession of friendship for the United States and her 
citizens. They refer with sentiments of gratitude to Com- 
modore Perry's visit in 1853, to them, apparently hostile 
at that time. They now consider this action as friendly 
and as the beginning of the growth of a great and pros- 
perous nation. They speak of the benefit Japan has re- 
ceived and is receiving from the United States, educa- 
tionally and otherwise. They claim to have received the 
largest benefit in economic lines by visits to and inter- 
course with Americans. They refer with satisfaction to 
the large and increasing trade relations. And, without 
stopping to enumerate, they speak of our people as their 
friends and advisers, now and always, as fair and gener- 
ous and pacificatory in policy and practice; as a model 
government, whose friendly interest they court. 

If you suggest these men may have dealt simply in 
diplomacy, so-called, or in diplomatic language, I answer, 
they gave me no reason to think so ; I secured their confi- 
dence as I gave them mine. They do not hesitate to ad- 
vance the reasons for peace and the objections to trouble. 
They realize that the geographical locations of these two 

16 



countries should make them practically allies although 
acting independently and in their individual capacities 
and interests. And, from the business standpoint, 
the Japanese manufacturers, merchants and financiers 
are desirous of co-operating with those in the United 
States, to the fullest extent, in protecting and pro- 
moting the welfare of both and at the same time 
benefiting those in other countries with whom both 
of us may be conducting business. They understand and 
appreciate the spirit of co-operation which has actuated 
the men engaged in our lines of business and they would 
be pleased to consider with us all legitimate plans for 
the application of this principle. While it is a difficult 
problem, requiring patience, skill and tact, still I believe 
we may be able to work out methods which will benefit all 
concerned. It is well worth trying. International condi- 
tions are peculiar. They are complicated and will be 
worse. Every one interested in international commerce 
should make careful survey of existing facts for purposes 
of future explorations and developments. There are many 
practical problems to consider and their solution will re- 
quire time and thought; but we will find the Japanese 
business men ready to take them up in a fair, reasonable 
and intelligent manner. 

What Japan Wishes in Ghina. 

The subject of Japan's intentions toward China and 
her possessions is a mooted question in many foreign 
quarters. From considerable inquiry and study, I con- 

17 



elude Japan sincerely desires that China shall proceed 
and succeed in the directions I have indicated; that she 
shall become firmly established as a sound, peaceful, pro- 
gressive, prosperous and rich government with free and 
open seaports, transacting an increasing business of every 
kind, within the limits of her capabilities, with any 
country or all countries outside her domains, on a fair, 
just and profitable basis. I am confident Japan would 
like China for a continuous, permanent, friendly, profit- 
able and satisfied customer, with no political, social or 
financial difficulties, internal or international. I think 
we may expect to see, before long, efforts on the 
part of the Japanese people to cultivate cordial busi- 
ness relations with those in China. I know there 
are important and influential men in Japan who 
will actively advocate this course. I am also of the 
opinion, founded on conversations, that the Japanese will 
be glad to consult with Americans concerning financial, 
commercial and even political questions relating to China. 
Japan and China both wish for close and intimate rela- 
tions with the United States and are willing to discuss 
and determine all matters affecting the rights and inter- 
ests of any, with the purpose of doing justice to them- 
selves and all other nations. The more our statesmen 
study these questions the more clearly it will appear there 
need be no irreconcilable differences of opinion. 

Korea. 

Korea, as you know, has again become a part of Japan. 
The name has been changed to Chosen, which is the same 

18 



word in the Japanese language. It is a fine country, with 
people of good appearance, disposition and physical and 
mental ability, fully equal to the average. Under Japanese 
methods, conditions and appearances are rapidly improv- 
ing. The Koreans seem to be satisfied with the govern- 
mental change. They have more respect for the present 
administration than they entertained towards former 
ones, and they believe their prosperity is increasing and 
will continue to increase. It seems probable there will be 
a gradual and complete amalgamation of the two races, 
and, if so, it will be beneficial to both. 

OuE Business Men Should Visit the Orient. 

ISTow, I would urge all of you, who find it practicable, 
to visit the Far East. Go during the autumn or early 
spring months, if convenient, but do not hesitate to make 
the journey during the summer time. You owe it to your- 
selves, to the business interests you represent and to your 
country to come into close relations with the people of 
these far distant lands. While they are far away, if 
measured by miles, yet in point of time they are growing 
nearer, by reason of improvements in transportation ; and 
the trip is enjoyable. You may be assured there are in- 
numerable features in each of the countries intensely at- 
tractive and in many respects different from what you 
have ever seen. While I was somewhat fatigued at times, 
I continued in good health and I have every reason to 
congratulate myself on having had the opportunity to see 
these countries and to meet so many agreeable people. If 

19 



you decide to do so, you likewise will be glad to have 
made the journey. 

More and more of our business men should come into 
close contact with the people of Japan, China and the 
Philippines. It will be of benefit to all. There is much 
to see and to learn. Many misunderstandings have arisen 
and some still exist. They can and should be removed. 
It is as true as it is old that human nature is about the 
same the world over. We in the United States are not 
possessed of all the virtues. We are just as likely to be 
wrong in judgment and conclusion as others. Indeed, we 
have often been wrong. If some of our leaders in Con- 
gress had been better posted, it is possible that many ill- 
advised speeches would not have been delivered. At any 
rate, I strongly urge that as many of our citizens as find 
it possible take the time to personally and impartially in- 
quire into the facts which bear upon the relations of the 
United States with other countries. There is always 
danger of unsettled disagreements if parties conduct their 
communications at arm's length. If they converse "eye 
to eye and face to face" even nations are much more likely 
to avoid conflict and to settle disputes without doing an 
injustice to any. If we are looking for trouble we can 
usually find it ; and if we are looking for harmony it is, 
as a rule, equally easy to procure. 

If any one connected with our government will spend 
a few months, or less time, in Japan, with an honest in- 
tention and effort to ascertain the sentiment of the large 
majority of the controlling elements, I verily believe such 
a one will be convinced Japan is not desirous of trouble 

20 



with the United States, but, on the contrary, earnestly 
desires our friendship and co-operation in every worthy 
ambition. 

Business Conditions. 

Following my usual custom I will conclude with a 
few words regarding business conditions. 

It is well known that the steel business in this country 
is better than ever before. Our concern is only for the 
future. Many believe there will be a continuance of large 
business for many months or years after the war closes; 
others think there will be a material recession. No one 
can certainly foretell. I have heretofore expressed opin- 
ions on the subject which have been published. Ob- 
viously the wise man will husband his resources, keep 
within safe limits and avoid over-extension. It is better 
to be prudent and make less profits than to becojne reck- 
less or extravagant at the risk of calamity. With large 
bank balances we are independent and secure ; with large 
indebtedness to the banks which we could not readily 
pay, we would be in danger of bankruptcy, depending 
upon future business conditions. All this we know by 
the experience of the past. As we cannot read the future 
we should exercise caution and be prepared for unfavor- 
able changes. 

Whenever the war shall close, the business of this 
country will be confronted with new conditions. The 
purchasing power of the whole world will have been very 
greatly reduced. Foreign countries who are now buying 
our products, because compelled, will withdraw their 

21 



patronage in a large measure. Other non-producing 
countries will find their financial resources and credits 
lessened. More than this, foreign producers, in great 
need, will strive more diligently than ever to supply the 
countries that are financially able to pay and at prices 
based upon cheap labor and low cost, as they have a per- 
fect right to do. 

Our producers, including our wage earners, will find 
themselves in commercial antagonism with the most per- 
sistent and difficult competition ever experienced, unless 
this shall be prevented by laws that are reasonable and 
sufficient. Most of the foreign producing countries, and 
quite likely all of them, will be thoroughly protected by 
tariff provisions and we should be on a parity with them 
in this respect. 

I firmly believe, if the present unprotective tariff laws 
remain unchanged, we shall probably meet with competi- 
tion from foreign sources after the war closes which will 
adversely, and perhaps disastrously, affect American in- 
dustry and American labor. Conditions will be even 
worse than they were between October 1st, 1913, and the 
beginning of the war. If the laws shall be amended and 
adequate protection to American producers and their 
workmen is afforded, we may expect satisfactory busi- 
ness conditions for some time to come. 



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